REGULATORY LABORATORY

ADGM is proud to present the first RegLab in the region and the world’s second most active FinTech sandbox. This tailored regulatory regime for FinTech participants is designed to foster innovation within the UAE financial services market for both new market entrants and existing financial institutions. Taking into account the unique business model and risks of the FinTech participant and customizing the test boundaries and regulatory requirements accordingly, the RegLab allows the participant to develop and test its FinTech proposition in a safe environment while not putting undue regulatory burden on the participant.

Admitted Oct 2017

WHAT IS REGLAB?

The ADGM RegLab is a specially-tailored regulatory framework which provides a controlled environment for FinTech participants to develop and test innovative FinTech solutions.

The RegLab is designed to allow FinTech innovation to be tested without being subjected to the full suite of regulatory requirements that would otherwise apply to traditional financial services firms, by creating a regulated environment to contain the specific risks and impact of any particular test. The safeguards of the RegLab will allow FinTech participants to explore and develop FinTech solutions in a riskappropriate and cost-effective environment.

WHO IS IT FOR?

The ADGM Reglab is for all participants active in the FinTech space, from start-ups to existing, regulated companies. To qualify, FinTech participants must be able to demonstrate an innovative technological solution that is at the stage of development ready for testing. The solution should also contribute to the development of the financial sector in UAE. In particular, it should:

EXCLUSIVE BENEFITS FOR REGLAB PARTICIPANTS

Support and mentorship from ADGM’s Innovation Centre partners including financial institutions, venture capital and angel investors, accelerators, technology firms, academic institutes and professional service providers

Access to core banking digital sandbox environment that allow participants to integrate their solutions with banking data and functionality, and to test them for scalability and robustness.

HOW DOES THE REGLAB WORK?

FSRA will assess the risks posed in each FinTech applicant’s business model and tailor a set of appropriate regulatory controls on a specific, caseby-case basis. For instance, rules that are not relevant to the applicant’s business model or FinTech solution will be waived or modified. Instead, FSRA may impose restrictions on the scope and scale of the test activities to mitigate the associated risks and impact.

The ADGM RegLab allows FSRA to adapt the regulatory requirements to the specific business model and risks of individual FinTech participants as they progress through different stages of development or testing.

Once authorised and admitted into the RegLab, FinTech participants are eligible to operate within the RegLab for a period of up to two years. During this time, FinTech participants are expected to test and develop their FinTech innovation to a point where it can be commercially launched.

Thereafter, FinTech participants will migrate to full financial services authorised status within ADGM. FinTech participants who are not ready to launch will exit the ADGM RegLab.

This serves as a one-stop-shop for all FinTech participants, both prospective and authorised, who wish to be part of the ADGM RegLab. FinTech participants have access to a dedicated ADGM RegLab team that provides regulatory support and guidance from pre-authorisation stage to exiting from the RegLab.

The RegLab team will advise and help FinTech participants appropriately to:

• Understand the RegLab requirements
• Apply for RegLab authorisation
• Draw up the regulatory controls and test plan for the FinTech solution
• Ensure compliance with the RegLab requirements

In addition to having direct access to the RegLab team, FinTech participants also benefit from engagements facilitated by the FSRA with relevant stakeholders. This may include mentorship support from accelerators, participation in workshops and fora to networking or showcasing their ideas to investors and clients, etc.

APPLICATION APPROACH

Step 1

Contact a member of the ADGM RegLab team, via email fintech@adgm.com to start the conversation with FSRA.

Step 2

You will be invited to discuss your proposal, which will help the RegLab team better understand your proposal and assist you in completing your application.

Step 3

Once the application has been submitted, FSRA will assess your FinTech proposal in accordance with the qualification criteria for inclusion in the RegLab.

Step 4

If the application is accepted, the ADGM RegLab team will work closely with you to build a bespoke set of regulatory requirements and conditions that will apply to the FinTech proposal.

HOW MUCH WILL IT COST

The applicable incorporation and licence fees for a RegLab participant will amount to US$4,500 in the first year and US$2,300 in the second year.
Therefore the total fees charged to a FinTech
participant is capped at USD$6,800 for the entire
2-year RegLab period.